Braemar Hotels & Resorts ((BHR)) has held its Q4 earnings call. Read on for the main highlights of the call.
Braemar Hotels & Resorts’ recent earnings call reflected a generally positive sentiment, highlighting significant RevPAR growth after a prolonged decline, successful refinancing efforts, and strong performance in both urban and resort hotel segments. Despite these achievements, the company reported a notable net loss and faced challenges due to external factors such as the Southern California fires.
RevPAR Growth After Six Quarters
The company achieved a 1.9% comparable RevPAR growth in Q4 2024, marking a positive turnaround after six consecutive quarters of decline. This growth signals a recovery in the performance of their hotel portfolio.
Total Revenue Increase
Braemar Hotels & Resorts reported a 5.3% increase in comparable total hotel revenue over the prior year period. This growth was primarily driven by a 7% increase in group revenue, showcasing the company’s ability to attract and retain group bookings.
Successful Refinancing Efforts
The company is actively engaged in discussions to refinance a $193 million loan maturing in June. With no remaining final debt maturities in 2025 after completion, this move is expected to strengthen the company’s financial position.
Urban Hotel Strength
Urban hotels within the portfolio saw a 3.3% comparable RevPAR growth in Q4 2024. The strong forward booking pace and a 9% RevPAR growth excluding Capital Hilton in January indicate robust demand in urban markets.
High-Impact Capital Projects
Several capital projects were completed, including the transformation of back-of-house space at Four Seasons Resort Scottsdale and renovation of fine dining at Ritz Carlton Reserve, Dorado Beach. These projects are expected to enhance guest experience and operational efficiency.
Ritz Carlton Saint Thomas Performance
The Ritz Carlton Saint Thomas experienced a remarkable 100% growth in group performance over the prior year, with a 65% increase in group room revenue, highlighting its strong market position.
Ritz Carlton Reserve Dorado Beach Financial Gains
The property increased its gross operating profit margins by over 1,100 basis points compared to 2019, driven by strategic pricing and operational efficiencies, underscoring the effectiveness of its management strategies.
Ritz Carlton Lake Tahoe Success
Following a renovation, Ritz Carlton Lake Tahoe delivered a 49% increase in total hotel revenue, propelled by significant increases in rooms and food and beverage revenue.
Net Loss Reported
Despite the positive developments, Braemar reported a net loss attributable to common stockholders of $31.1 million for the quarter and $50.9 million for the full year, reflecting ongoing financial challenges.
Negative AFFO
The company reported a negative AFFO per diluted share of $0.06 for the quarter, indicating areas that need improvement in financial performance.
Impact of Southern California Fires
The Southern California fires led to demand fluctuations in the Los Angeles market, causing transient demand volatility and group business cancellations, which adversely affected performance.
Forward-Looking Guidance
Looking ahead, Braemar Hotels & Resorts provided several strategic updates. The company reported a comparable RevPAR increase of 1.9% to $305 and a total hotel revenue growth of 5.3%. For the full year, they reported a net loss of $50.9 million or $0.77 per diluted share, with adjusted EBITDAre at $157.6 million. The company is focused on refinancing efforts and plans to invest $75 million to $95 million in capital expenditures in 2025. Additionally, they redeemed around $80 million of non-traded preferred stock as part of their shareholder value creation plan.
In summary, Braemar Hotels & Resorts’ earnings call highlighted a positive sentiment with notable achievements in RevPAR growth and successful refinancing efforts. However, the company continues to face financial challenges, including a significant net loss and the impact of external factors like the Southern California fires. The forward-looking guidance suggests a strategic focus on financial stability and shareholder value creation.